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ADA supports legislation to reform Paycheck Protection Program, asks for additional flexibility

May 27, 2020

By Jennifer Garvin

Photo of Washington Monument
Washington — The ADA is supporting new legislation to increase flexibility in the Paycheck Protection Program but continues to advocate for further changes to help dentists who have received these loans.

In a May 26 letter to Reps. Chip Roy, R-Texas, and Dean Phillips, D-Minn., ADA President Chad P. Gehani and Executive Director Kathleen T. O’Loughlin thanked the lawmakers for introducing HR 6886, the Paycheck Protection Program Flexibility Act.

If enacted, the bill would provide flexibility for Paycheck Protection Program loans, including granting additional time for the forgiveness period beyond the current eight-week limitation and flexibility on the 75/25 payroll vs. operating costs that the Department of the Treasury and the Small Business Administration determined in the agencies’ rule-making. The ADA also supports the bill’s plan to defer payroll tax and introduce protections for employers who make “good faith efforts” to rehire employees.

“Given the fact that most dental practices are small businesses, access to small business loan programs through the Small Business Administration are a lifeline for our practice owners and their staff,” Drs. Gehani and O’Loughlin wrote.

“Although many of our members have taken advantage of Paycheck Protection Program loans, the lack of flexibility for these loans left many of our members uncertain about how to use the funds so that they could maintain their businesses but still receive full loan forgiveness. Many of our members applied for and received funds before they were even able to open due to state or local restrictions on non-emergency procedures,” they continued, adding that “only about 30% of dental practices have reopened” as of May 4 and are currently seeing only 28% of their patients, according to the ADA Health Policy Institute.

The ADA also asked the legislators to include additional provisions to the Paycheck Protection Program Flexibility Act or in future legislation; chiefly, the addition of a tax credit or grant for businesses that received their Paycheck Protection Program loans early in the process and have made every effort to follow the rules — even without full guidance from the agencies — to achieve full loan forgiveness.

“Many dental offices hired their employees back even before they were allowed to reopen in order to comply with the intent of the CARES Act and the Paycheck Protection Program loan program,” Drs. Gehani and O’Loughlin wrote. “Those entities should be given additional compensation since they will likely not be able to take full advantage of the flexibility.”

The ADA also said that the Association and other stakeholders will continue to advocate for allowing 501(c)(6) organizations to apply for Paycheck Protection Program loans or other small business loan programs, and to allow the funds to be used to pay for the additional personal protective equipment that dental offices now require to protect dentists, their employees and their patients.

“We are supportive of the legislation and urge you to consider the additional flexibility we have highlighted in order to ensure that Paycheck Protection Program loans provide the best possible support for non-profits, dental practices and all small businesses nationwide,” the letter concluded.

Follow all of the ADA’s advocacy efforts in response to the pandemic at ADA.org/COVID19Advocacy.

Editor’s note: After the letter was sent, the bill number was changed from HR 6886 to HR 7010.